From business continuity planning to insurance policy management, risk managers have their hands full when it comes to being prepared for a potential loss. Time and again, we hear stories of entities filing insurance claims only to find they didn’t have adequate coverage.
If you’re managing a large property portfolio, ensuring your buildings and structures are sufficiently covered by insurance can be a challenge. Below are five strategies you can implement today to make sure your property is properly insured in the future.
Audit Your Current Processes and Procedures
It never hurts to take a step back and review your current processes and procedures. Look especially for gaps in communication that could leave you uninformed of upgrades or additions.
Have an Onsite, Physical Inspection Every Two to Three Years
An onsite, physical inspection produces more current, accurate, and complete results than a desktop appraisal or multiple years of value trending. While it’s not necessary every year, it’s a good practice to have an onsite appraisal done at least every three years.
Parametric insurance is gaining popularity
Parametric insurance, which pays out a predetermined amount of money based on the occurrence of specific events with defined parameters, is becoming more popular. As an example of how it works, consider the occurrence of a windstorm; if the wind reaches a certain speed, that may trigger a payout of parametric insurance. A main reason parametric insurance is gaining in popularity because the payout can be particularly fast, addressing coverage gaps, and flexibility.
Insure the Correct Value
From construction cost to fair market value, there can be many different numbers associated with a building or structure. The important number for insurance purposes is replacement cost which reflects the estimated cost to reconstruct a duplicate of the building at current prices.
Maintain Documentation
Having comprehensive documentation on your buildings and their contents can help ensure that in the event a claim is made you are receiving adequate support. This includes maintenance and inspection information. If you’re HVAC system was working like new before the loss, it should be working like new after the loss.
Really Get to Know Your Policy
Thoroughly understand your policy and its exclusions. Take some time to play “what-if” and don’t be afraid to ask your insurer about additional coverage if you think it’s necessary.
What steps does your organization take to ensure its property portfolio is properly insured? Share with us by emailing info@centurisk.com and you could be featured in an upcoming blog post.